We started 99designs to provide opportunities to designers. Each month more and more designers make meaningful salaries from the site and connect with customers that they would otherwise have had to pitch for. Customers who wouldn't have previously paid for design are learning design is worth paying for.
It's hard for any industry to face change, but developers survived outsourcing and photographers survived stock photography. Both industries are still flourishing.
You forgot to mention that the precursor to 99designs - Sitepoint Marketplace - was initiated by designers themselves. It only happened because designers wanted it. If 99designs didn't formalise it, someone else would've. It's called emergence; it's one of the most fundamental processes in society and indeed nature.
I had the worst experience using 99designs. The "designers" were terrible. The sketches they submitted shows that they barely have any design skills, when I reject their designs they start to complain and build up bad reputation around you.
Most if not all freelancing sites start well until they are discovered by unqualified people from India and the likes.
Even many US & UK based designers find it more more worthwhile to use 99designs as a customer acquisition channel vs. doing unpaid proposal writing, pitching, or expensive paid advertising which has no guarantee of results.
